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Judge: Identify gas-lease nominators

A federal judge has ordered the Bureau of Land Management to release the identity of parties that nominated parcels for oil and gas leasing in the North Fork Valley.

U.S. District Judge Richard Matsch issued the order in a lawsuit brought by the Delta County group Citizens for a Healthy Community and Western Environmental Law Center. The groups consider it a precedent-setting ruling in terms of how the agency handles lease sales.

The BLM had said two nominators’ “expressions of interest” in having the parcels leased contain commercial or financial information that is privileged or confidential.

The BLM doesn’t release nominators’ names until after lease sales. Matsch noted the agency also cites the highly competitive nature of oil and gas exploration on public lands, and the possibility that nominators may do preliminary investigative work regarding acreage they are interested in, and if their interest is made public, competitors may gain an unfair advantage and bid against the submitter.

But Matsch wrote in his ruling, “That contention runs directly contrary to the purpose of the public sale process. Competition in bidding advances the purpose of getting a fair price for a lease of publicly owned minerals. Moreover, the identity of the submitter may be relevant to the plaintiff and others who may raise concern about the stewardship records of that potential owner, a factor relevant to the environmental impact of the proposed sale.”

Citizens for a Healthy Community and others in the North Fork Valley voiced environmental and other concerns when the BLM proposed leasing about 30,000 acres there. The agency backed off that proposal and instead planned to offer 20,500 acres at a lease sale being held Thursday, but then pulled that acreage from the sale to further evaluate whether it should be leased.

Matsch gave the BLM 30 days to release the names of the nominating parties.

Steven Hall, a spokesman for the BLM’s Colorado state office, said the agency would need to review the decision before commenting.

Jim Ramey, director of Citizens for a Healthy Community, said it’s possible the BLM could appeal.

“In my opinion, they’ve had a very weak argument from the start of this case. ... Bottom line is these are the lease of publicly owned minerals, and the public has the right to know who wants to lease them,” he said.

David Ludlam, executive director of the West Slope Colorado Oil and Gas Association, said companies always have the option of using brokers to nominate and bid for leases to maintain confidentiality. However, he said the ruling could lead to circumstances such as a large energy company nominating a parcel and getting it for less because smaller companies don’t bid, assuming they don’t stand a chance of winning.

In such a case, “American taxpayers will receive less for the leases they’re selling,” he said.

The BLM Colorado office Thursday sold 111 parcels totaling 68,897 acres for $2.1 million in its quarterly lease sale. The highest per-acre price was $300 per acre by Martin Oil and Gas for an 80-acre parcel in Bent County.

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By Lee Cassin - Friday, February 15, 2013

Thank goodness! Competition is what the free market is all about - it’s the American way, so I’m sure the oil and gas companies will all support it!